Exhibit (c)
EXECUTION COPY
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AMENDED AND RESTATED
INVESTORS AGREEMENT
DATED AS OF
APRIL 9, 1998
AMONG
IPC INFORMATION SYSTEMS, INC.
CABLE SYSTEMS HOLDING, LLC
CABLE SYSTEMS INTERNATIONAL, INC.
AND
CERTAIN OTHER PERSONS NAMED HEREIN
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NY02A/164456.13
TABLE OF CONTENTS
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PAGE
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ARTICLE 1 DEFINITIONS
Section 1.01. Definitions............................................. 1
ARTICLE 2 CORPORATE GOVERNANCE AND MANAGEMENT
Section 2.01. Composition of the Board................................ 5
Section 2.02. Removal................................................. 5
Section 2.03. Vacancies............................................... 5
Section 2.04. Action by the Board..................................... 5
Section 2.05. Conflicting Charter or Bylaw Provision.................. 6
Section 2.06. IXNET Board............................................. 6
ARTICLE 3 RESTRICTIONS ON TRANSFER
Section 3.01. General................................................. 6
Section 3.02. Legends................................................. 6
Section 3.03. Permitted Transferees................................... 6
Section 3.04. Restrictions on Transfers by Xxxxxxxxxxx Shareholders... 6
Restrictions on Transfers by Xxxxx Shareholders and
Section 3.05. Xxxxxxxx Shareholders................................... 7
ARTICLE 4 TAG-ALONG RIGHTS; DRAG-ALONG RIGHTS
Section 4.01. Rights to Participate in Transfer....................... 7
Section 4.02. Right to Compel Participation in Certain Transfers...... 8
ARTICLE 5 REGISTRATION RIGHTS
Section 5.01. Demand Registration..................................... 10
Section 5.02. Piggyback Registration.................................. 11
Section 5.03. Holdback Agreements..................................... 12
Section 5.04. Registration Procedures................................. 12
Section 5.05. Indemnification by the Company.......................... 14
Section 5.06. Indemnification by Participating Shareholders........... 15
Section 5.07. Conduct of Indemnification Proceedings.................. 15
Section 5.08. Contribution............................................ 16
Section 5.09. Participation in Public Offering........................ 16
Section 5.10. Rule 144................................................ 17
Section 5.11. No Transfer of Registration Rights...................... 17
ARTICLE 6 CERTAIN COVENANTS AND AGREEMENTS
Section 6.01. Limitations on Subsequent Registration.................. 17
Section 6.02. Limitation on Purchase of Common Stock.................. 17
ARTICLE 7 MISCELLANEOUS
Section 7.01. Entire Agreement........................................ 17
Section 7.02. Binding Effect; Benefit................................. 17
Section 7.03. Assignability........................................... 18
Section 7.04. Amendment; Waiver; Termination.......................... 18
Section 7.05. Notices................................................. 18
Section 7.06. Headings................................................ 20
Section 7.07. Counterparts............................................ 20
Section 7.08. Governing Law........................................... 20
Section 7.09. Specific Enforcement.................................... 20
Section 7.10. Certain Actions......................................... 20
Section 7.11. Consent to Jurisdiction; Expenses....................... 21
Section 7.12. Severability............................................ 21
Section 7.13. Schedule I.............................................. 21
Section 7.14. Effectiveness........................................... 21
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Schedule I Securities Ownership
Exhibit A Form of Joinder Agreement
ii
AMENDED AND RESTATED INVESTORS AGREEMENT
AMENDED AND RESTATED INVESTORS AGREEMENT, dated as of April 9, 1998, among
(i) IPC Information Systems, Inc. (the "Company"), (ii) Cable Systems Holding,
LLC, a Delaware limited liability company ("CSH"), (iii) Cable Systems
International, Inc., a Delaware Corporation, (iv) Xxxxxxx Xxxxxxxxxxx, (v)
Xxxxx Xxxxx, (vi) Xxxxxxx Xxxxxxxx and (vii) Xxxxxxxx, Xxxxx & Xxxxx III,
L.P., a Delaware limited partnership.
W I T N E S S E T H:
WHEREAS, pursuant to the terms of the Merger Agreement (as defined below),
Arizona Acquisition Corp. will be merged with and into the Company, with the
Company as the surviving corporation (the "Merger");
WHEREAS, at the Effective Time (as defined in the Merger Agreement) the
parties hereto will hold securities of the Company as set forth on Schedule I
to be attached hereto at the Effective Time;
WHEREAS, the parties hereto desire to enter into this Agreement to govern
certain of their rights, duties and obligations after consummation of the
transactions contemplated by the Merger Agreement;
The parties hereto agree as follows:
ARTICLE 1
DEFINITIONS
Section 1.01. Definitions. (a) The following terms, as used herein, have the
following meanings:
"Adverse Person" means any Person whom the Board of Directors of the Company
may reasonably determine to be a competitor or a potential competitor of the
Company or its Subsidiaries.
"Affiliate" means, with respect to any Person, any other Person directly or
indirectly controlling, controlled by, or under common control with such
Person, provided that no securityholder of the Company shall be deemed an
Affiliate of any other securityholder solely by reason of any investment in
the Company. For the purpose of this definition, the term "control" (including
with correlative meanings, the terms "controlling", "controlled by" and "under
common control with"), as used with respect to any Person, shall mean the
possession, directly or indirectly, of the power to direct or cause the
direction of the management and policies of such Person, whether through the
ownership of voting securities or by contract or otherwise.
"beneficially own" shall have the meaning set forth in Rule 13d-3 of the
Exchange Act.
"Board" means the board of directors of the Company.
"Business Day" means any day except a Saturday, Sunday or other day on which
commercial banks in New York City are authorized by law to close.
"Change of Control" means such time as (a) the CSH Shareholders shall own
less than 20% of the outstanding shares of Common Stock, (b) the transfer of
all or substantially all of the assets of the Company to any Person or group
shall have been consummated, or (c) the Company shall have been liquidated.
"Closing Date" shall have the meaning ascribed thereto in the Merger
Agreement.
"Common Stock" shall mean the common stock, par value $.01 per share, of the
Company and any stock into which such Common Stock may thereafter be converted
or changed; provided, however, that in the event of a stock dividend, split-
up, recapitalization, combination, exchange of stock or the like in respect of
such Common Stock, the term "Common Stock" shall be deemed to refer to and
include the stock as well as all stock dividends and distributions and any
stock into which or for which any or all of such stock may be changed or
exchanged.
"CSH Entities" means (a) CSH and (b) Cable Systems International Inc., a
Delaware Corporation.
"CSH Shareholders" means the CSH Entities and their direct and indirect
Permitted Transferees so long as any such Person shall beneficially own any
Common Stock.
"Drag-Along Portion" means, with respect to any Xxxxxxxxxxx Shareholder, any
Xxxxx Shareholder any Xxxxxxxx Shareholder or any LSH Shareholder, the number
of Shares beneficially owned by such Xxxxxxxxxxx Shareholder, Xxxxx
Shareholder, Xxxxxxxx Shareholder or any LSH Shareholder multiplied by a
fraction, the numerator of which is the number of Shares to be sold by the CSH
Shareholders on behalf of the CSH Shareholders and the Xxxxxxxxxxx
Shareholders, the Xxxxx Shareholders, the Xxxxxxxx Shareholders and the LSH
Shareholders and the denominator of which is the total number of Shares then
beneficially owned by all of the Shareholders.
"Exchange Act" means the Securities Exchange Act of 1934, as amended.
"Fully Diluted" means all outstanding shares of Common Stock and all shares
issuable in respect of securities convertible into or exchangeable or
exercisable for such Common Stock, stock appreciation rights or options,
warrants and other irrevocable rights to purchase or subscribe for such Common
Stock or securities convertible into or exchangeable or exercisable for such
Common Stock; provided that no Person shall be deemed to own such number of
Fully Diluted shares of any Common Stock as such Person has the right to
acquire from any Person other than the Company.
"Initial Ownership" means, with respect to any Shareholder, the number of
shares of Common Stock beneficially owned (and (without duplication) which
such Persons have the right to acquire from any Person) as of the Effective
Time, or in the case of any Person that shall become a party to this Agreement
on a later date, as of such date, taking into account any stock split, stock
dividend, reverse stock split or similar event.
"Xxxxxxxxxxx Shareholders" means Xxxxxxx Xxxxxxxxxxx and his direct and
indirect Permitted Transferees so long as any such Person shall beneficially
own any Common Stock.
"LSH" means Xxxxxxxx, Xxxxx & Xxxxx XXX, L.P.
"LSH Shareholders" means LSH and its direct and indirect Permitted
Transferee so long as any such Person shall beneficially own any Common Stock.
"Merger Agreement" means the Agreement and Plan of Merger dated as of the
date hereof, as subsequently amended, between the Company and Arizona
Acquisition Corp.
"Permitted Transferee" means (i) in the case of any Shareholder who is a
natural person, (a) a spouse or lineal descendent (including by adoption and
stepchildren), heir, executor, testamentary trustee or legatee of such
Shareholder or (b) any trust or estate the beneficiaries of which, or any
corporation, limited liability company or partnership, the stockholders,
members or partners of which include only the Persons described in clause (a)
above, (ii) in the case of any CSH Shareholder, (a) Citicorp Venture Capital,
Ltd., any stockholder, member, partner or Affiliate of any such CSH
Shareholder or of Citicorp Venture Capital, Ltd. and any officer, director, or
employee of any such CSH Shareholder, Citicorp Venture Capital, Ltd. or of any
such stockholder, member, partner or Affiliate, (b) a spouse or lineal
descendant (including by adoption and stepchildren), heir, executor,
testamentary trustee or legatee of the officers, directors and employees
referred to in clause (ii)(a) above, and any trust or estate (where a majority
in interest of the beneficiaries thereof are any of the Persons described in
this clause (b) and in clause (ii)(a) above), corporation, limited liability
company or partnership (where a majority in interest of the stockholders,
members or limited partners, or where the managing general partner, is one of
more of the Persons described in this clause (b) or in clause (ii)(a) above
and (iii) in the case of any LSH Shareholder, (a) any shareholder, member,
partner or Affiliate of such LSH Shareholder or (b) a spouse or lineal
descendant (including by adoption and stepchildren), heir, executor,
testamentary trustee or legatee of the shareholders, members and partners
referred to in clause (iii)(a) above, and any trust or estate (where a
majority
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in interest of the beneficiaries thereof are any of the Persons described in
this clause (b) and in clause (iii)(a) above), corporation, limited liability
company or partnership (where a majority in interest of the stockholders,
members or limited partners, or where the managing general partner, is one of
more of the Persons described in this clause (b) or in clause (iii)(a) above.
"Person" means an individual, corporation, limited liability company,
partnership, association, trust or other entity or organization, including a
government or political subdivision or an agency or instrumentality thereof.
"Pro Rata Portion" means the number of Shares a Shareholder holds multiplied
by a fraction, the numerator of which is the number of Shares to be sold by
the CSH Shareholders, the Xxxxxxxxxxx Shareholders, the Xxxxx Shareholders,
the Xxxxxxxx Shareholders and the LSH Shareholders in a Public Offering and
the denominator of which is the total number of Shares, on a Fully Diluted
basis, held in the aggregate by the CSH Shareholders, the Xxxxxxxxxxx
Shareholders, the Xxxxx Shareholders, the Xxxxxxxx Shareholders and the LSH
Shareholders immediately prior to such Public Offering.
"Public Offering" means any primary or secondary public offering of shares
of Common Stock pursuant to an effective registration statement under the
Securities Act other than pursuant to a registration statement filed in
connection with a transaction of the type described in Rule 145 of the
Securities Act or for the purpose of issuing securities pursuant to an
employee benefit plan.
"Registrable Securities" means at any time, with respect to any Shareholder,
any shares of Common Stock then owned by such Shareholder until (i) a
registration statement covering such securities has been declared effective by
the SEC and such securities have been disposed of pursuant to such effective
registration statement, (ii) such securities are sold to the public pursuant
to Rule 144 (or any similar provisions then in force) under the Securities Act
or (iii) such securities are otherwise transferred, the Company has delivered
a new certificate or other evidence of ownership for such securities not
bearing the legend required pursuant to this Agreement and such securities are
freely tradeable without restriction by the holder thereof under the
Securities Act.
"Registration Expenses" means (i) all registration and filing fees, (ii)
fees and expenses of compliance with securities or blue sky laws (including
reasonable fees and disbursements of counsel in connection with blue sky
qualifications of the securities registered), (iii) printing expenses, (iv)
internal expenses of the Company (including, without limitation, all salaries
and expenses of its officers and employees performing legal or accounting
duties), (v) reasonable fees and disbursements of counsel for the Company and
customary fees and expenses for independent certified public accountants
retained by the Company (including expenses relating to any comfort letters or
costs associated with the delivery by independent certified public accountants
of a comfort letter or comfort letters requested pursuant to Section 5.04(g)
hereof), (vi) the reasonable fees and expenses of any special experts retained
by the Company in connection with such registration, (vii) reasonable fees and
expenses of up to one counsel for the Shareholders participating in the
offering, (viii) fees and expenses in connection with any review of
underwriting arrangements by the National Association of Securities Dealers,
Inc. (the "NASD"), including fees and expenses of any "qualified independent
underwriter" and (ix) fees and disbursements of underwriters customarily paid
by issuers or sellers of securities, but shall not include any underwriting
fees, discounts or commissions attributable to the sale of Registrable
Securities, or any out-of-pocket expenses (except as set forth in clause (vii)
above) of the Shareholders.
"SEC" means the Securities and Exchange Commission.
"Securities Act" means the Securities Act of 1933, as amended.
"Xxxxxxxx Shareholders" means Xxxxxxx Xxxxxxxx and his direct and indirect
Permitted Transferees so long as any such Person shall beneficially own any
Common Stock.
"Shareholder" means each Person (other than the Company) who shall be a
party to this Agreement, whether in connection with the execution and delivery
hereof as of the date hereof, pursuant to Section 7.03 or otherwise, so long
as such Person shall beneficially own any Common Stock.
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"Shares" means shares of Common Stock held by the Shareholders.
"Subject Securities" means the Common Stock beneficially owned by the
Xxxxxxxxxxx Shareholders, the Xxxxx Shareholders and the Xxxxxxxx Shareholders
and the LSH Shareholders to be transferred in a Section 4.02 Sale.
"Subsidiary" means, with respect to any Person, any entity of which
securities or other ownership interests having ordinary voting power to elect
a majority of the board of directors or other persons performing similar
functions are at the time directly or indirectly owned by such Person.
"Tag-Along Portion" means the number of Shares held by the Tagging Person or
the Selling Person, as the case may be, multiplied by a fraction, the
numerator of which is the number of Shares proposed to be sold by the Selling
Person pursuant to Section 4.01, and the denominator of which is the aggregate
number of Shares, on a Fully Diluted basis, then owned by the Selling Person.
"Third Party" means a prospective purchaser of Common Stock from a
Shareholder where such purchaser is not a Permitted Transferee of such
Shareholder or an entity in which such Shareholder or any of its Permitted
Transferees directly or indirectly owns any outstanding securities or other
ownership interests having ordinary voting power.
"Underwritten Public Offering" means a firmly underwritten public offering
of Registrable Securities of the Company pursuant to an effective registration
statement under the Securities Act.
"Xxxxx Shareholders" means Xxxxx and his direct and indirect Permitted
Transferees so long as any such Person shall beneficially own any Common
Stock.
(b) Each of the following terms is defined in the Section set forth opposite
such term:
TERM SECTION
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Cause......................................................... 2.02
Demand Registration........................................... 5.01(a)
Drag-Along Rights............................................. 4.02(a)
Free Percentage............................................... 4.01(a)
Holders....................................................... 5.01(a)(ii)
Indemnified Party............................................. 5.07
Indemnifying Party............................................ 5.07
Inspectors.................................................... 5.04(g)
Joinder Agreement............................................. 3.03
Maximum Offering Size......................................... 5.01(e)
Nominee....................................................... 2.03(a)
Piggyback Registration........................................ 5.02(a)
Records....................................................... 5.04(g)
Section 4.01 Response Notice.................................. 4.01(a)
Section 4.02 Sale............................................. 4.02(a)
Section 4.02 Notice........................................... 4.02(a)
Section 4.02 Sale Price....................................... 4.02(a)
Section 4.02 Notice Period.................................... 4.02(a)
Selling Person................................................ 4.01(a)
Selling Shareholder........................................... 5.01(a)
Tag-Along Notice.............................................. 4.01(a)
Tag-Along Notice Period....................................... 4.01(a)
Tag-Along Offer............................................... 4.01(a)
Tag-Along Right............................................... 4.01(a)
Tag-Along Sale................................................ 4.01(a)
Tagging Person................................................ 4.01(a)
Transfer...................................................... 3.01(a)
Xxxxx......................................................... Preamble
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ARTICLE 2
CORPORATE GOVERNANCE AND MANAGEMENT
Section 2.01. Composition of the Board. The Board shall consist of nine
members, of whom (i) three shall be nominated by the CSH Shareholders, (ii)
two shall be nominated by the CSH Shareholders and shall be individuals which
are not "Affiliates" or "Associates" (as those terms are used within the
meaning of Rule 12b-2 of the General Rules and Regulations under the Exchange
Act) of any Shareholder or its Affiliates, (iii) two shall be nominated by the
CSH Shareholders and shall be individuals who are executive officers of the
Company or its Subsidiaries and (iv) two shall be nominated by the Xxxxxxxxxxx
Shareholders. Each Shareholder entitled to vote for the election of directors
to the Board agrees that it will vote its shares of Common Stock or execute
consents, as the case may be, and take all other necessary action (including
causing the Company to call a special meeting of shareholders) in order to
ensure that the composition of the Board is as set forth in this Section 2.01;
provided that, no Shareholder shall be required to vote for the CSH
Shareholders' or the Xxxxxxxxxxx Shareholders' nominee(s) , as applicable, if
the number of Shares held by the group of Shareholders, as applicable, making
the nomination is, at the close of business on the day preceding such vote or
execution of consents, (x) less than 5% of the outstanding number of Shares of
Common Stock, in the case of the CSH Shareholders or (y) less than 50% of its
Initial Ownership of Common Stock, in the case of the Xxxxxxxxxxx
Shareholders.
Section 2.02. Removal. Subject to applicable law, each Shareholder agrees
that if, at any time, it is then entitled to vote for the removal of directors
of the Company, it will not vote any of its Shares in favor of the removal of
any director who shall have been designated or nominated pursuant to Section
2.01 unless such removal shall be for Cause or the Person(s) entitled to
designate or nominate such director shall have consented to such removal in
writing, provided that if the Persons entitled to designate or nominate any
director pursuant to Section 2.01 shall request the removal, with or without
Cause, of such director in writing, each such Shareholder shall vote its
shares of Common Stock in favor of such removal. Removal for "Cause" shall
mean removal of a director because of such director's (a) willful and
continued failure substantially to perform his duties with the Company in his
established position, (b) willful conduct which is injurious to the Company or
any of its Subsidiaries, monetarily or otherwise, (c) conviction for, or
guilty plea to, a felony or a crime involving moral turpitude, or (d) abuse of
illegal drugs or other controlled substances or habitual intoxication.
Section 2.03. Vacancies. If, as a result of death, disability, retirement,
resignation, removal (with or without Cause) or otherwise, there shall exist
or occur any vacancy on the Board:
(a) The Shareholder(s) entitled under Section 2.01 to nominate such
director whose death, disability, retirement, resignation or removal
resulted in such vacancy, may, subject to the provisions of Section 2.01,
nominate another individual (the "Nominee") to fill such vacancy and serve
as a director of the Company; and
(b) each Shareholder then entitled to vote for the election of the
Nominee as a director of the Company agrees that it will vote its Shares,
or execute a written consent, as the case may be, in order to ensure that
the Nominee be elected to the Board; provided that, no Shareholder shall be
required to vote for another party's Nominee(s) if the aggregate number of
Shares held by the Shareholder or group of Shareholders, as applicable,
making the nomination is, at the close of business of the day preceding
such vote or execution of consents, less than (x) 5% of the outstanding
number of Shares of Common Stock, in the case of the CSH Shareholders or
(y) less than 50% of the Initial Ownership of Common Stock, in the case of
the Xxxxxxxxxxx Shareholders.
Section 2.04. Action by the Board. (a) A quorum at any meeting of the Board
shall consist of five directors.
(b) All actions of the Board shall require the affirmative vote of at least
a majority of the directors present at a duly convened meeting of the Board at
which a quorum is present or the unanimous written consent of the Board;
provided that, in the event there is a vacancy on the Board and an individual
has been nominated to fill such vacancy, the first order of business shall be
to fill such vacancy.
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Section 2.05. Conflicting Charter or Bylaw Provision. Each Shareholder shall
vote its Shares, and shall take all other actions reasonably necessary, to
ensure that the Company's certificate of incorporation and bylaws are
consistent with, facilitate and do not at any time conflict with any provision
of this Agreement.
Section 2.06. IXNET Board. For so long as (a) International Exchange Network
Ltd, a Delaware corporation ("IXNET") is a wholly-owned Subsidiary of the
Company and (b) Xxxxx Xxxxx is an employee of IXNET, the Company shall cause
Xxxxx Xxxxx to be a member of the board of directors of IXNET.
ARTICLE 3
RESTRICTIONS ON TRANSFER
Section 3.01. General. (a) Each Shareholder agrees that it will not,
directly or indirectly, sell, assign, transfer, grant a participation in,
pledge or otherwise dispose of ("transfer") any Common Stock (or solicit any
offers to buy or otherwise acquire, or take a pledge of any Common Stock)
except in compliance with the Securities Act and the terms and conditions of
this Agreement.
(b) Any attempt to transfer any Common Stock not in compliance with this
Agreement shall be null and void and the Company shall not, and shall cause
any transfer agent not to, give any effect in the Company's stock records to
such attempted transfer.
Section 3.02. Legends. (a) In addition to any other legend that may be
required, each certificate for shares of Common Stock that is issued to any
Shareholder shall bear a legend in substantially the following form:
"THE SHARES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED UNDER
THE SECURITIES ACT OF 1933, AS AMENDED, AND MAY NOT BE SOLD, PLEDGED OR
OTHERWISE TRANSFERRED EXCEPT PURSUANT TO AN EFFECTIVE REGISTRATION
STATEMENT OR IN ACCORDANCE WITH AN EXEMPTION FROM THE REGISTRATION
REQUIREMENTS OF THE SECURITIES ACT OF 1933, AS AMENDED. SHARES REPRESENTED
BY THIS CERTIFICATE ARE SUBJECT TO RESTRICTIONS ON TRANSFER AS SET FORTH IN
THE INVESTORS AGREEMENT DATED AS OF DECEMBER 18, 1997, COPIES OF WHICH MAY
BE OBTAINED UPON REQUEST FROM IPC INFORMATION SYSTEMS, INC. OR ANY
SUCCESSOR THERETO."
(b) If any Common Stock shall cease to be subject to any and all
restrictions on transfer set forth in this Agreement, the Company shall, upon
the written request of the holder thereof, issue to such holder a new
certificate evidencing such Common Stock without the legend required by
Section 3.02(a) endorsed thereon.
Section 3.03. Permitted Transferees. Any Shareholder may at any time
transfer any or all of its Shares to one or more of its Permitted Transferees
without the consent of the Company or any Shareholder or group of Shareholders
and without compliance with Sections 3.04 and 4.01 so long as (a) such
Permitted Transferee shall have executed a Joinder Agreement substantially in
the form of Exhibit A hereto ("Joinder Agreement") and thereby agreed to be
bound by the terms of this Agreement and (b) the transfer to such Permitted
Transferee is not in violation of applicable federal or state securities laws.
Section 3.04. Restrictions on Transfers by Xxxxxxxxxxx Shareholders. (a)
Except as provided in Section 3.03, the Xxxxxxxxxxx Shareholders may transfer
their Common Stock only as follows:
(i) in a transfer made in compliance with Section 4.01 or Section 4.02;
(ii) in a Public Offering in connection with the exercise of their rights
under Article 5 hereof; or
(iii) following the earlier to occur of (i) the date on which the number
of Shares held by the Xxxxxxxxxxx Shareholders is less than 5% of the
outstanding number of Shares of Common Stock and (ii) the fifth anniversary
of the Closing Date, to any Person other than any Adverse Person.
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(b) The restrictions set forth in Section 3.04 shall terminate at such time
as the aggregate number of Shares of Common stock held by the CSH Shareholders
is less than 50% of the CSH Shareholders' aggregate Initial Ownership of
Common Stock.
Section 3.05. Restrictions on Transfers by Xxxxx Shareholders and Xxxxxxxx
Shareholders. Except as provided in Section 3.03, the Xxxxx Shareholders and
the Xxxxxxxx Shareholders may transfer their Common Stock only as follows:
(i) in a transfer made in compliance with Section 4.01 of Section 4.02;
or
(ii) in any Public Offering; or
(iii) following the 30th month anniversary of the Closing Date, to any
Person other than any Adverse Person; or
(iv) to any Person, in a transfer through a broker or dealer in
compliance with Rule 144 (or any successor rule).
Section 3.06. Restrictions on Transfers by LSH Shareholders. Except as
provided in Section 3.03, the LSH Shareholders may transfer their Common Stock
only as follows:
(i) in a transfer made in compliance with Section 4.01 of Section 4.02;
or
(ii) in any Public Offering; or
(iii) to any Person, in a transfer through a broker or dealer in
compliance with Rule 144 (or any successor rule).
ARTICLE 4
TAG-ALONG RIGHTS; DRAG-ALONG RIGHTS
Section 4.01. Rights to Participate in Transfer. (a) If CSH Shareholders
(the "Selling Person") propose to, directly or indirectly, transfer (other
than transfers of Shares (i) in a Public Offering, (ii) to any Permitted
Transferee of any of the CSH Shareholders, (iii) up to 3% in the aggregate of
the securities of such class outstanding on the date of the first transfer of
any Shares by any of the CSH Shareholders (such percentage, the "Free
Percentage") or (iv) that will indirectly result from a sale of all or
substantially all of the capital stock or assets of CSH, CSI, Cable Systems
Holding Company, Citicorp or any of its Subsidiaries) shares of Common Stock
(a "Tag-Along Sale"), the Xxxxxxxxxxx Shareholders and/or the Xxxxx
Shareholders and/or the Xxxxxxxx Shareholders and/or the LSH Shareholders may,
at their option, elect to exercise their rights under this Section 4.01 (each
such Shareholder, a "Tagging Person"). In the event of such a proposed
transfer, the Selling Person shall provide each Xxxxxxxxxxx Shareholder, each
Xxxxx Shareholder, each Xxxxxxxx Shareholder, each LSH Shareholder and the
Company written notice of the material terms and conditions of such proposed
transfer ("Tag-Along Notice") and offer each Tagging Person the opportunity to
participate in such sale. The Tag-Along Notice shall identify the number of
shares of Common Stock subject to the offer ("Tag-Along Offer"), the
consideration for which the transfer is proposed to be made and all other
material terms and conditions of the Tag-Along Offer. Each Tagging Person
shall have the right (a "Tag-Along Right"), exercisable by irrevocable written
notice (a "Section 4.01 Response Notice") given within 10 Business Days from
receipt of the Tag-Along Notice (the "Tag-Along Notice Period") to participate
in such Tag-Along Sale on the same terms and conditions as set forth in the
Tag-Along Notice and to sell all or any portion of its Tag-Along Portion. If
the Tagging Persons exercise their Tag-Along Rights hereunder, each Tagging
Person shall deliver at least two business days prior to the date scheduled
for the closing of the Tag-Along Sale to the Selling Person for delivery to
the prospective transferee one or more certificates, in a proper form for
transfer, representing the Shares of such Tagging Person to be included in the
Tag-Along Sale. Such certificate or certificates that a Tagging Person
delivers to the Selling Person shall be delivered on the date scheduled for
the closing of the Tag-Along Sale to such transferee in consummation of the
Tag-Along Sale. Notwithstanding anything to the contrary contained in this
Section 4.01, except for the Selling Person's obligation to return to each
Tagging Person any certificates representing the Tagging Person's Shares there
shall be no liability on the part of the Selling Person to any Shareholder in
the event that the proposed Tag-Along Sale is not consummated for whatever
reason. Whether a Tag-Along Sale is effected pursuant to this Section 4.01 by
the Selling Person is in the sole and absolute discretion of the Selling
Person.
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(b) Concurrently with the consummation of the Tag-Along Sale, the Selling
Person shall notify the Tagging Persons thereof, shall remit to the Tagging
Persons the total consideration (by bank or certified check) for the Shares of
the Tagging Persons transferred pursuant thereto, and shall, promptly after
the consummation of such Tag-Along Sale, furnish such other evidence of the
completion and time of completion of such transfer and the terms thereof as
may be reasonably requested by the Tagging Persons.
(c) If at the termination of the Tag-Along Notice Period any Tagging Person
shall not have elected to participate in the Tag-Along Sale, such Tagging
Person will be deemed to have waived its rights under Section 4.01(a) with
respect to the transfer of its securities pursuant to such Tag-Along Sale.
(d) If any Tagging Person declines to exercise its Tag-Along Rights or
elects to exercise its Tag-Along Rights with respect to less than such Tagging
Person's Tag-Along Portion, the CSH Shareholders shall be entitled to
transfer, pursuant to the Tag-Along Offer, a number of Shares held by the CSH
Shareholders equal to the number of Shares constituting the portion of such
Tagging Person's Tag-Along Portion with respect to which Tag-Along Rights were
not exercised.
(e) The CSH Shareholders and any Tagging Person who exercises the Tag-Along
Rights pursuant to this Section 4.01 may consummate the Tag-Along Sale on
substantially the same terms and conditions set forth in the Tag-Along Notice
(provided, however, that the price payable in any such sale may exceed the
price specified in the Tag-Along Notice by up to 5%) within 120 days of the
date on which Tag-Along Rights shall have been waived, exercised or expire.
(f) The exercise or the non-exercise of the rights of the Tagging Persons to
participate in one or more Tag-Along Sales shall not adversely affect their
rights to participate in subsequent Tag-Along Sales subject to this Section
4.01.
(g) The sale of the Selling Person's Shares in any Tag-Along Sale shall be
effected on the same terms and conditions as the sale of any Tagging Person's
Shares and no Selling Person shall receive any form of special consideration
or control premium in addition to the price payable for the sold Shares.
(h) The right of the Xxxxxxxxxxx Shareholders, the Xxxxx Shareholders, the
Xxxxxxxx Shareholders and the LSH Shareholders to participate in a Tag-Along
Sale shall terminate at such time as the aggregate number of Shares held by
the Xxxxxxxxxxx Shareholders, the Xxxxx Shareholders, the Xxxxxxxx
Shareholders or the LSH Shareholders, as the case may be, is less than 50% of
their aggregate Initial Ownership of Common Stock.
Section 4.02. Right to Compel Participation in Certain Transfers. (a) If (i)
the CSH Shareholders propose to transfer Shares representing not less than 50%
of their aggregate Initial Ownership of Common Stock to a Third Party in a
bona fide sale for cash negotiated on an arms-length basis, and (ii) the CSH
Shareholders propose a transfer in which the Shares to be transferred by the
CSH Shareholders, the Xxxxxxxxxxx Shareholders, the Xxxxx Shareholders, the
Xxxxxxxx Shareholders and the LSH Shareholders would constitute more than 50%
of the outstanding shares of Common Stock determined on a fully diluted basis
(a "Section 4.02 Sale"), the CSH Shareholders may at their option require all
Xxxxxxxxxxx Shareholders, Xxxxx Shareholders, Xxxxxxxx Shareholders and the
LSH Shareholders to sell the Subject Securities ("Drag-Along Rights") then
held by every Xxxxxxxxxxx Shareholder, Xxxxx Shareholder, Xxxxxxxx
Shareholders and the LSH Shareholders to such Third Party, for the same
consideration per share of Common Stock and otherwise on the same terms and
conditions as the CSH Shareholders. CSH shall provide written notice of such
Section 4.02 Sale to the Xxxxxxxxxxx Shareholders, the Xxxxx Shareholders, the
Xxxxxxxx Shareholders, the LSH Shareholders and the Company (a "Section 4.02
Notice") not later than the 30th day prior to the proposed Section 4.02 Sale.
The Section 4.02 Notice shall identify the transferee, the number of Subject
Securities, the consideration for which a transfer is proposed to be made (the
"Section 4.02 Sale Price") and all other material terms and conditions of the
Section 4.02 Sale. The number of shares of Common Stock to be sold by each
Xxxxxxxxxxx Shareholder, Xxxxx Shareholder, Xxxxxxxx Shareholder and LSH
Shareholder shall not exceed the Drag-Along Portion of the shares of Common
Stock that such Xxxxxxxxxxx Shareholder, Xxxxx Shareholder, Xxxxxxxx
Shareholder and LSH
8
Shareholder owns. Each Xxxxxxxxxxx Shareholder, Xxxxx Shareholder, Xxxxxxxx
Shareholder or LSH Shareholder shall be required to participate in the Section
4.02 Sale on the terms and conditions set forth in the Section 4.02 Notice and
to tender all its Subject Securities as set forth below. The price payable in
such transfer shall be the Section 4.02 Sale Price. Each of the Xxxxxxxxxxx
Shareholders, Xxxxx Shareholders, Xxxxxxxx Shareholders or LSH Shareholder
shall deliver not later than 2 Business Days prior to the date scheduled for
the Section 4.02 Sale to a representative of CSH designated in the Section
4.02 Notice certificates representing all Subject Securities held by such
Xxxxxxxxxxx Shareholder, Xxxxx Shareholder, Xxxxxxxx Shareholder and LSH
Shareholder duly endorsed, together with all other documents required to be
executed in connection with such Section 4.02 Sale or, if such delivery is not
permitted by applicable law, an unconditional agreement to deliver such
Subject Securities pursuant to this Section 4.02 at the closing for such
Section 4.02 Sale against delivery to such Xxxxxxxxxxx Shareholder, Xxxxx
Shareholder, Xxxxxxxx Shareholder and LSH Shareholder of the consideration
therefor. If a Xxxxxxxxxxx Shareholder, Xxxxx Shareholder, Xxxxxxxx
Shareholder or LSH Shareholder should fail to deliver such certificates to
CSH, the Company shall cause the books and records of the Company to show that
such Subject Securities are bound by the provisions of this Section 4.02 and
that such Subject Securities shall be transferred to the purchaser of the
Subject Securities immediately upon surrender for transfer by the holder
thereof.
(b) The CSH Shareholders shall have a period of 120 days from the date of
receipt of the Section 4.02 Notice to consummate the Section 4.02 Sale on the
terms and conditions set forth in such Section 4.02 Sale Notice. If the
Section 4.02 Sale shall not have been consummated during such period, CSH
shall return to each of the Xxxxxxxxxxx Shareholders, each of the Xxxxx
Shareholders, each of the Xxxxxxxx Shareholders and each of the LSH
Shareholders all certificates representing Shares that such Xxxxxxxxxxx
Shareholder, Xxxxx Shareholder, Xxxxxxxx Shareholder or LSH Shareholder, as
the case may be, may have delivered for transfer pursuant hereto, together
with any documents in the possession of CSH executed by the Xxxxxxxxxxx
Shareholder, the Xxxxx Shareholder, the Xxxxxxxx Shareholder or the LSH
Shareholder, as the case may be, in connection with such proposed transfer,
and all the restrictions on transfer contained in this Agreement or otherwise
applicable at such time with respect to Common Stock owned by the Xxxxxxxxxxx
Shareholders, the Xxxxx Shareholders, the Xxxxxxxx Shareholders and the LSH
Shareholders shall again be in effect.
(c) Concurrently with the consummation of the transfer of Shares pursuant to
this Section 4.02, CSH or the Company, as applicable, shall remit to each of
the Shareholders who have surrendered their certificates the total
consideration (by bank or certified check) for the Shares transferred pursuant
hereto and shall furnish such other evidence of the completion and time of
completion of such transfer and the terms thereof as may be reasonably
requested by such Shareholders.
(d) In furtherance of, and not in limitation of the foregoing provisions of
this Section 4.02, in connection with a Section 4.02 Sale (which Section 4.02
Sale may be structured as a merger, recapitalization, reorganization, sale of
assets or otherwise) each Xxxxxxxxxxx Shareholder, Xxxxx Shareholder, Xxxxxxxx
Shareholder or LSH Shareholder will (i) consent to and raise no objection
against the Section 4.02 Sale or the process pursuant to which it was
arranged, (ii) waive any appraisal rights and other similar rights and (iii)
execute all documents containing such terms and conditions as those executed
by other Shareholders as directed by the CSH Shareholders.
(e) The sale of the CSH Shareholders' Shares in any Section 4.02 Sale shall
be effected on the same terms and conditions as the sale of any Shares owned
by the Xxxxxxxxxxx Shareholders, the Xxxxx Shareholders, the Xxxxxxxx
Shareholders and the LSH Shareholders and no CSH Shareholder shall receive any
form of special consideration or control premium in addition to the price
payable for the sold Shares.
9
ARTICLE 5
REGISTRATION RIGHTS
Section 5.01. Demand Registration. (a) If the Company shall receive a
written request by the CSH Shareholders (any such requesting Person, a
"Selling Shareholder") that the Company effect the registration under the
Securities Act of all or a portion of such Selling Shareholder's Registrable
Securities, and specifying the intended method of disposition thereof, then
the Company shall promptly give written notice of such requested registration
(a "Demand Registration") to the Xxxxxxxxxxx Shareholders, the Xxxxx
Shareholders, the Xxxxxxxx Shareholders and the LSH Shareholders, and
thereupon will use its best efforts to effect, as expeditiously as possible,
the registration under the Securities Act of:
(i) the Registrable Securities which the Company has been so requested to
register by the Selling Shareholders, then held by the Selling
Shareholders; and
(ii) all other Registrable Securities of the same type as that to which
the request by the Selling Shareholders relates which any Xxxxxxxxxxx
Shareholder, any Xxxxx Shareholder, any Xxxxxxxx Shareholder or any LSH
Shareholder (all such Shareholders, together with the Selling Shareholders,
the "Holders") has requested the Company to register by written request
received by the Company within 10 days (one of which shall be a Business
Day) after the receipt by such Holders of such written notice given by the
Company, all to the extent necessary to permit the disposition (in
accordance with the intended methods thereof as aforesaid) of the
Registrable Securities so to be registered; provided that, subject to
Section 5.01(d) hereof, the Company shall not be obligated to effect more
than five Demand Registrations for the CSH Shareholders; and provided
further that the Company shall not be obligated to effect a Demand
Registration unless the aggregate proceeds expected to be received from the
sale of the Common Stock requested to be included in such Demand
Registration, in the reasonable opinion of CSH exercised in good faith,
equals or exceeds $7,500,000. In no event will the Company be required to
effect more than one Demand Registration within any four-month period.
(b) Promptly after the expiration of the 10-day period referred to in
Section 5.01(a)(ii) hereof, the Company will notify all the Holders to be
included in the Demand Registration of the other Holders and the number of
Registrable Securities requested to be included therein. The Selling
Shareholders requesting a registration under Section 5.01(a) may, at any time
prior to the effective date of the registration statement relating to such
registration, revoke such request, without liability to any of the other
Holders, by providing a written notice to the Company revoking such request,
in which case such request, so revoked, shall be considered a Demand
Registration unless such revocation arose out of the fault of the Company or
unless the participating Shareholders reimburse the Company for all costs
incurred by the Company in connection with such registration, in which case
such request shall not be considered a Demand Registration.
(c) The Company will pay all Registration Expenses in connection with any
Demand Registration.
(d) A registration requested pursuant to this Section 5.01 shall not be
deemed to have been effected unless the registration statement relating
thereto (i) has become effective under the Securities Act and (ii) all of the
Registrable Securities registered thereunder have been sold; provided that if,
within 180 days after it has become effective, the offering of Registrable
Securities pursuant to such registration is interfered with by any stop order,
injunction or other order or requirement of the SEC or other governmental
agency or court such registration will be deemed not to have been effected.
(e) If a Demand Registration involves an Underwritten Public Offering and
the managing underwriter shall advise the Company and the Selling Shareholders
that, in its view, (i) the number of shares of Registrable Securities
requested to be included in such registration (including any securities which
the Company proposes to be included which are not Registrable Securities) or
(ii) the inclusion of some or all of the shares of Registrable Securities
owned by the Holders, in any such case, exceeds the largest number of shares
which can be sold without having an adverse effect on such offering, including
the price at which such shares can be sold (the
10
"Maximum Offering Size"), the Company will include in such registration, in
the priority listed below, up to the Maximum Offering Size:
(A) first, all Registrable Securities requested to be registered by the
parties requesting such Demand Registration and all Registrable Securities
requested to be included in such registration by any other Holder
(allocated, if necessary for the offering not to exceed the Maximum
Offering Size, pro rata among such Holders on the basis of the relative
number of Registrable Securities so requested to be included in such
registration); and
(B) second, any securities proposed to be registered by the Company.
(f) Upon written notice to each Selling Shareholder, the Company may
postpone effecting a registration pursuant to this Section 5.01 on one
occasion during any period of six consecutive months for a reasonable time
specified in the notice but not exceeding 90 days (which period may not be
extended or renewed), if (1) an investment banking firm of recognized national
standing shall advise the Company and the Selling Shareholders in writing that
effecting the registration would materially and adversely affect an offering
of securities of such Company the preparation of which had then been commenced
or (2) the Company is in possession of material non-public information the
disclosure of which during the period specified in such notice the Company
believes, in its reasonable judgment, would not be in the best interests of
the Company.
(g) After the Company has effected one Demand Registration by the CSH
Shareholders pursuant to this Section 5.01 of Common Stock, the Xxxxxxxxxxx
Shareholders, upon request of the Xxxxxxxxxxx Shareholders owning a majority
of the Shares acquired by the Xxxxxxxxxxx Shareholders on the Closing Date may
request that the Company register Common Stock which are Registrable
Securities then owned by such Xxxxxxxxxxx Shareholders. In no event will the
Company be required to effect more than two such Demand Registrations by the
Xxxxxxxxxxx Shareholders. The other provisions of this Article 5 applicable to
Demand Registrations requested by the CSH Shareholders shall apply, mutatis
mutandis, to any such Demand Registration by the Xxxxxxxxxxx Shareholders.
(h) If any registration requested pursuant to this Section 5.01 which is
proposed by the Company to be effected by the filing of a registration
statement on form S-3 (or any successor or similar short-form registration
statement) shall be in connection with an Underwritten Public Offering, and if
the managing underwriter shall advise the Company in writing that, in its
opinion, the use of another form of registration statement is of material
importance to the success of such proposed offering, then such registration
shall be effected on such other form.
Section 5.02. Piggyback Registration. Piggyback Registration. (a) If the
Company proposes to register any of its Common Stock under the Securities Act
(other than pursuant to a Demand Registration), it will each such time,
subject to the provisions of Section 5.02(b) hereof, give prompt written
notice at least 15 days prior to the anticipated filing date of the
registration statement relating to such registration to all Shareholders which
notice shall set forth such Shareholders' rights under this Section 5.02 and
shall offer all Shareholders the opportunity to include in such registration
statement such number of shares of Common Stock as each such Shareholder may
request (a "Piggyback Registration"). Upon the written request of any such
Shareholder made within 10 days after the receipt of notice from the Company
(which request shall specify the number of shares of Common Stock intended to
be disposed of by such Shareholder), the Company will use its reasonable best
efforts to effect the registration under the Securities Act of all shares of
Common Stock which the Company has been so requested to register by such
Shareholders, to the extent requisite to permit the disposition of the shares
of Common Stock so to be registered; provided that (i) if such registration
involves an Underwritten Public Offering, all such Shareholders requesting to
be included in the Company's registration must sell their Registrable
Securities to the underwriters selected as provided in Section 5.04(f) on the
same terms and conditions as apply to the Company or the Selling Shareholder,
as applicable, and (ii) if, at any time after giving written notice of its
intention to register any stock pursuant to this Section 5.02(a) and prior to
the effective date of the registration statement filed in connection with such
registration, the Company shall determine for any reason not to register such
stock, the Company shall give written notice to all such Shareholders and,
thereupon, shall be relieved of its obligation to register any Registrable
Securities in connection with such registration. No
11
registration effected under this Section 5.02 shall relieve the Company of its
obligations to effect a Demand Registration to the extent required by Section
5.01 hereof. The Company will pay all Registration Expenses in connection with
each registration of Registrable Securities requested pursuant to this Section
5.02.
(b) If a registration pursuant to this Section 5.02 involves an Underwritten
Public Offering and the managing underwriter advises the Company that, in its
view, the number of shares of Common Stock which the Company and the selling
Shareholders intend to include in such registration exceeds the Maximum
Offering Size, the Company will include in such registration, in the following
priority, up to the Maximum Offering Size:
(i) first, so much of the Common Stock proposed to be registered for the
account of the Company as would not cause the offering to exceed the
Maximum Offering Size; and
(ii) second, all Registrable Securities requested to be included in such
registration by any Shareholder pursuant to Section 5.02 (allocated, if
necessary for the offering not to exceed the Maximum Offering Size, pro
rata among such Shareholders on the basis of the relative number of shares
of Registrable Securities so requested to be included in such
registration).
Section 5.03. Holdback Agreements. With respect to each and every firmly
underwritten Public Offering, each Shareholder agrees not to offer or sell any
shares of Common Stock (except for shares of Common Stock, if any, sold in
that Public Offering) during the 14 days prior to the effective date of the
applicable registration statement for a public offering of shares of Common
Stock (except as part of such registration) and during the period after such
effective date equal to the lesser of: (i) 180 days or (ii) any such shorter
period as the Company and the lead managing underwriter of an Underwritten
Public Offering agree.
Section 5.04. Registration Procedures. Whenever Shareholders request that
any Registrable Securities be registered pursuant to Section 5.01 or 5.02
hereof, the Company will, subject to the provisions of such Sections, use its
reasonable best efforts to effect the registration and the sale of such
Registrable Securities in accordance with the intended method of disposition
thereof as quickly as practicable, and in connection with any such request:
(a) The Company will as expeditiously as possible prepare and file with
the SEC a registration statement on any form selected by counsel for the
Company and which form shall be available for the sale of the Registrable
Securities to be registered thereunder in accordance with the intended
method of distribution thereof, and use its reasonable best efforts to
cause such filed registration statement to become and remain effective for
a period of not less than 180 days (or such shorter period in which all of
the Registrable Securities of the Holders included in such registration
statement shall have actually been sold thereunder).
(b) The Company will, if requested, prior to filing a registration
statement or prospectus or any amendment or supplement thereto, furnish to
each Shareholder and each underwriter, if any, of the Registrable
Securities covered by such registration statement copies of such
registration statement as proposed to be filed, and thereafter the Company
will furnish to such Shareholder and underwriter, if any, such number of
copies of such registration statement, each amendment and supplement
thereto (in each case including all exhibits thereto and documents
incorporated by reference therein), the prospectus included in such
registration statement (including each preliminary prospectus) and such
other documents as such Shareholder or underwriter may reasonably request
in order to facilitate the disposition of the Registrable Securities owned
by such Shareholder. Each Shareholder shall have the right to request that
the Company modify any information contained in such registration
statement, amendment and supplement thereto pertaining to such Shareholder
and the Company shall use its reasonable best efforts to comply with such
request, provided, however, that the Company shall not have any obligation
to so modify any information if so doing would cause the prospectus to
contain an untrue statement of a material fact or omit to state any
material fact required to be stated therein or necessary to make the
statements therein not misleading.
(c) After the filing of the registration statement, the Company will (i)
cause the related prospectus to be supplemented by any required prospectus
supplement, and as so supplemented to be filed pursuant to
12
Rule 424 under the Securities Act, (ii) comply with the provisions of the
Securities Act with respect to the disposition of all Registrable
Securities covered by such registration statement during the applicable
period in accordance with the intended methods of disposition by the
sellers thereof set forth in such registration statement or supplement to
such prospectus and (iii) promptly notify each Shareholder holding
Registrable Securities covered by such registration statement of any stop
order issued or threatened by the SEC or any state securities commission
under state blue sky laws and take all reasonable actions required to
prevent the entry of such stop order or to remove it if entered.
(d) The Company will use its reasonable best efforts to (i) register or
qualify the Registrable Securities covered by such registration statement
under such other securities or blue sky laws of such jurisdictions in the
United States as any Shareholder holding such Registrable Securities
reasonably (in light of such Shareholder's intended plan of distribution)
requests and (ii) cause such Registrable Securities to be registered with
or approved by such other governmental agencies or authorities as may be
necessary by virtue of the business and operations of the Company and do
any and all other acts and things that may be reasonably necessary or
advisable to enable such Shareholder to consummate the disposition of the
Registrable Securities owned by such Shareholder; provided that the Company
will not be required to (A) qualify generally to do business in any
jurisdiction where it would not otherwise be required to qualify but for
this paragraph (d), (B) subject itself to taxation in any such jurisdiction
or (C) consent to general service of process in any such jurisdiction.
(e) The Company will immediately notify each Shareholder holding such
Registrable Securities covered by such registration statement, at any time
when a prospectus relating thereto is required to be delivered under the
Securities Act, of the occurrence of an event requiring the preparation of
a supplement or amendment to such prospectus so that, as thereafter
delivered to the purchasers of such Registrable Securities, such prospectus
will not contain an untrue statement of a material fact or omit to state
any material fact required to be stated therein or necessary to make the
statements therein not misleading and promptly prepare and make available
to each such Shareholder and file with the SEC any such supplement or
amendment.
(f) In connection with any Demand Registration requested by the CSH
Shareholders, the Company shall appoint the underwriter or underwriters
chosen by CSH. The Company will enter into customary agreements (including
an underwriting agreement in customary form) and take such other actions as
are reasonably required in order to expedite or facilitate the disposition
of such Registrable Securities, including the engagement of a "qualified
independent underwriter" in connection with the qualification of the
underwriting arrangements with the NASD.
(g) Upon execution of confidentiality agreements in form and substance
reasonably satisfactory to the Company, the Company will make available for
inspection by any Shareholder and any underwriter participating in any
disposition pursuant to a registration statement being filed by the Company
pursuant to this Section 5.04 and any attorney, accountant or other
professional retained by any such Shareholder or underwriter (collectively,
the "Inspectors"), all financial and other records, pertinent corporate
documents and properties of the Company (collectively, the "Records") as
shall be reasonably requested by any such Person, and cause the Company's
officers, directors and employees to supply all information reasonably
requested by any Inspectors in connection with such registration statement.
(h) The Company will furnish to each such Shareholder (if requested by
such Shareholder) and to each such underwriter, if any, a signed
counterpart, addressed to such underwriter and the participating
Shareholders, of (i) an opinion or opinions of counsel to the Company and
(ii) a comfort letter or comfort letters from the Company's independent
public accountants, each in customary form and covering such matters of the
type customarily covered by opinions or comfort letters, as the case may
be, as a majority of such Shareholders or the managing underwriter therefor
reasonably requests.
(i) The Company will otherwise use its reasonable best efforts to comply
with all applicable rules and regulations of the SEC and the relevant state
blue sky commissions, and make available to its securityholders, as soon as
reasonably practicable, an earnings statement covering a period of 12
months,
13
beginning within three months after the effective date of the registration
statement, which earnings statement shall satisfy the provisions of Section
11(a) of the Securities Act.
(j) The Company may require each such Shareholder to promptly furnish in
writing to the Company information regarding the distribution of the
Registrable Securities as the Company may from time to time reasonably
request and such other information as may be legally required in connection
with such registration.
(k) Each such Shareholder agrees that, upon receipt of any notice from
the Company of the happening of any event of the kind described in Section
5.04(e) hereof, such Shareholder will forthwith discontinue disposition of
Registrable Securities pursuant to the registration statement covering such
Registrable Securities until such Shareholder's receipt of the copies of
the supplemented or amended prospectus contemplated by Section 5.04(e)
hereof, and, if so directed by the Company, such Shareholder will deliver
to the Company all copies, other than any permanent file copies then in
such Shareholder's possession, of the most recent prospectus covering such
Registrable Securities at the time of receipt of such notice. In the event
that the Company shall give such notice, the Company shall extend the
period during which such registration statement shall be maintained
effective (including the period referred to in Section 5.04(a) hereof) by
the number of days during the period from and including the date of the
giving of notice pursuant to Section 5.04(e) hereof to the date when the
Company shall make available to such Shareholder a prospectus supplemented
or amended to conform with the requirements of Section 5.04(e) hereof.
(l) The Company will use its reasonable best efforts to list such
Registrable Securities on any securities exchange on which the Common Stock
is then listed or on NASDAQ if the Common Stock is then quoted on NASDAQ
not later than the effective date of such registration statement.
Section 5.05. Indemnification by the Company. The Company agrees to
indemnify and hold harmless each Shareholder holding Registrable Securities
covered by a registration statement, its officers, directors, employees,
members, partners and agents, any affiliate of such Shareholder and each
Person, if any, who controls such Shareholder within the meaning of the
Securities Act or Section 20 of the Exchange Act (and officers, directors,
employees, members, partners and agents of any such affiliate or controlling
Persons) from and against any and all losses, claims, damages and liabilities,
joint or several, and expenses (including reasonable attorneys fees and costs
and expenses of investigation) caused by any untrue statement or alleged
untrue statement of a material fact contained in any registration statement or
prospectus relating to the Registrable Securities (as amended or supplemented
if the Company shall have furnished any amendments or supplements thereto) or
any preliminary prospectus, or caused by any omission or alleged omission to
state therein a material fact required to be stated therein or necessary to
make the statements therein not misleading, except insofar as such losses,
claims, damages or liabilities are caused by any such untrue statement or
omission or alleged untrue statement or omission so made in strict conformity
with information furnished in writing to the Company by such Shareholder or on
such Shareholder's behalf expressly for use therein; provided that with
respect to any untrue statement or omission or alleged untrue statement or
omission made in any preliminary prospectus, or in any prospectus, as the case
may be, the indemnity agreement contained in this paragraph shall not apply to
the extent that any such loss, claim, damage, liability or expense results
from the fact that a current copy of the prospectus (or, in the case of a
prospectus, the prospectus as amended or supplemented) was not sent or given
to the Person asserting any such loss, claim, damage, liability or expense at
or prior to the written confirmation of the sale of the Registrable Securities
concerned to such Person if it is determined that the Company has provided
such current copy of such prospectus (or such amended or supplemented
prospectus, as the case may be) to such Shareholder in a timely manner prior
to such sale and it was the responsibility of such Shareholder under the
Securities Act to provide such Person with a current copy of the prospectus
(or such amended or supplemented prospectus, as the case may be) and such
current copy of the prospectus (or such amended or supplemented prospectus, as
the case may be) would have cured the defect giving rise to such loss, claim,
damage, liability or expense. The Company also agrees to indemnify any
underwriters of the Registrable Securities, their officers and directors and
each person who controls such underwriters on substantially the same basis as
that of the indemnification of the Shareholders provided in this Section 5.05.
14
Section 5.06. Indemnification by Participating Shareholders. Each
Shareholder holding Registrable Securities included in any registration
statement agrees, severally but not jointly, to indemnify and hold harmless
the Company, its officers, directors and agents and each Person (other than
such Shareholder) if any, who controls the Company within the meaning of
either Section 15 of the Securities Act or Section 20 of the Exchange Act to
the same extent as the foregoing indemnity from the Company to such
Shareholder, but only (i) with respect to information furnished in writing by
such Shareholder or on such Shareholder's behalf expressly for use in any
registration statement or prospectus relating to the Registrable Securities,
or any amendment or supplement thereto, or any preliminary prospectus or (ii)
to the extent that any loss, claim, damage, liability or expense described in
Section 5.05 results from the fact that a current copy of the prospectus (or,
in the case of a prospectus, the prospectus as amended or supplemented) was
not sent or given to the Person asserting any such loss, claim, damage,
liability or expense at or prior to the written confirmation of the sale of
the Registrable Securities concerned to such Person if it is determined that
it was the responsibility of such Shareholder to provide such Person with a
current copy of the prospectus (or such amended or supplemented prospectus, as
the case may be) and such current copy of the prospectus (or such amended or
supplemented prospectus, as the case may be) would have cured the defect
giving rise to such loss, claim, damage, liability or expense. Each such
Shareholder shall be prepared, if required by the underwriting agreement, to
indemnify and hold harmless underwriters of the Registrable Securities, their
officers and directors and each person who controls such underwriters on
substantially the same basis as that of the indemnification of the Company
provided in this Section 5.06. As a condition to including Registrable
Securities in any registration statement filed in accordance with Article 5
hereof, the Company may require that it shall have received an undertaking
reasonably satisfactory to it from any underwriter to indemnify and hold it
harmless to the extent customarily provided by underwriters with respect to
similar securities.
No Shareholder shall be liable under Section 5.06 for any damage thereunder
in excess of the net proceeds realized by such Shareholder in the sale of the
Registrable Securities of such Shareholder.
Section 5.07. Conduct of Indemnification Proceedings. In case any proceeding
(including any governmental investigation) shall be instituted involving any
Person in respect of which indemnity may be sought pursuant to this Article 5,
such Person (an "Indemnified Party") shall promptly notify the Person against
whom such indemnity may be sought (the "Indemnifying Party") in writing and
the Indemnifying Party shall assume the defense thereof, including the
employment of counsel reasonably satisfactory to such Indemnified Party, and
shall assume the payment of all fees and expenses; provided that the failure
of any Indemnified Party so to notify the Indemnifying Party shall not relieve
the Indemnifying Party of its obligations hereunder except to the extent that
the Indemnifying Party is materially and actually prejudiced by such failure
to notify. In any such proceeding, any Indemnified Party shall have the right
to retain its own counsel, but the fees and expenses of such counsel shall be
at the expense of such Indemnified Party unless (i) the Indemnifying Party and
the Indemnified Party shall have mutually agreed to the retention of such
counsel or (ii) in the reasonable judgment of such Indemnified Party
representation of both parties by the same counsel would be inappropriate due
to actual or potential differing interests between them. It is understood that
the Indemnifying Party shall not, in connection with any proceeding or related
proceedings in the same jurisdiction, be liable for the reasonable fees and
expenses of more than one separate firm of attorneys (in addition to any local
counsel) at any time for all such Indemnified Parties, and that all such fees
and expenses shall be reimbursed as they are incurred. In the case of any such
separate firm for the Indemnified Parties, such firm shall be designated in
writing by the Indemnified Parties. The Indemnifying Party shall not be liable
for any settlement of any proceeding effected without its written consent, but
if settled with such consent, or if there be a final judgment for the
plaintiff, the Indemnifying Party shall indemnify and hold harmless such
Indemnified Parties from and against any and all losses, claims, damages,
liabilities and expenses or liability (to the extent stated above) by reason
of such settlement or judgment. No Indemnifying Party shall, without the prior
written consent of the Indemnified Party, effect any settlement of any pending
or threatened proceeding in respect of which any Indemnified Party is or could
have been a party and indemnity could have been sought hereunder by such
Indemnified Party, unless such settlement includes an unconditional release of
such Indemnified Party from all liability arising out of such proceeding.
15
Section 5.08. Contribution. If the indemnification provided for in this
Article 5 is held by a court of competent jurisdiction to be unavailable to
the Indemnified Parties in respect of any losses, claims, damages, liabilities
or expenses referred to herein, then each such Indemnifying Party, in lieu of
indemnifying such Indemnified Party, shall contribute to the amount paid or
payable by such Indemnified Party as a result of such losses, claims, damages
or liabilities (i) as between the Company and the Shareholders holding
Registrable Securities covered by a registration statement and their related
Indemnified Parties on the one hand and the underwriters and their related
Indemnified Parties on the other, in such proportion as is appropriate to
reflect the relative benefits received by the Company and such Shareholders on
the one hand and the underwriters on the other, from the offering of the
Shareholders' Registrable Securities, or if such allocation is not permitted
by applicable law, in such proportion as is appropriate to reflect not only
the relative benefits but also the relative fault of the Company and such
Shareholders on the one hand and of such underwriters on the other in
connection with the statements or omissions which resulted in such losses,
claims, damages or liabilities, as well as any other relevant equitable
considerations and (ii) as between the Company and their related Indemnified
Parties on the one hand and each such Shareholder and their related
Indemnified Parties on the other, in such proportion as is appropriate to
reflect the relative fault of the Company and of each such Shareholder in
connection with such statements or omissions, as well as any other relevant
equitable considerations. The relative benefits received by the Company and
such Shareholders on the one hand and such underwriters on the other shall be
deemed to be in the same proportion as the total proceeds from the offering
(net of underwriting discounts and commissions but before deducting expenses)
received by the Company and such Shareholders bear to the total underwriting
discounts and commissions received by such underwriters, in each case as set
forth in the table on the cover page of the prospectus. The relative fault of
the Company and such Shareholders on the one hand and of such underwriters on
the other shall be determined by reference to, among other things, whether the
untrue or alleged untrue statement of a material fact or the omission or
alleged omission to state a material fact relates to information supplied by
the Company and such Shareholders or by such underwriters. The relative fault
of the Company on the one hand and of each such Shareholder on the other shall
be determined by reference to, among other things, whether the untrue or
alleged untrue statement of a material fact or the omission or alleged
omission to state a material fact relates to information supplied by such
party, and the parties' relative intent, knowledge, access to information and
opportunity to correct or prevent such statement or omission.
The Company and the Shareholders agree that it would not be just and
equitable if contribution pursuant to this Section 5.08 were determined by pro
rata allocation or by any other method of allocation which does not take
account of the equitable considerations referred to in the immediately
preceding paragraph. The amount paid or payable by an Indemnified Party as a
result of the losses, claims, damages, liabilities or expenses referred to in
the immediately preceding paragraph shall be deemed to include, subject to the
limitations set forth above, any legal or other expenses reasonably incurred
by such Indemnified Party in connection with investigating or defending any
such action or claim. Notwithstanding the provisions of this Section 5.08 no
underwriter shall be required to contribute any amount in excess of the
underwriting discount applicable to securities purchased by such underwriter
in such offering, less the aggregate amount of any damages which such
underwriter has otherwise been required to pay by reason of such untrue or
alleged untrue statement or omission or alleged omission, and no Shareholder
shall be required to contribute any amount in excess of the amount by which
the net proceeds realized on the sale of the Registrable Securities of such
Shareholder exceeds the amount of any damages which such Shareholder has
otherwise been required to pay by reason of such untrue or alleged untrue
statement or omission or alleged omission. No person guilty of fraudulent
misrepresentation (within the meaning of Section 11(f) of the Securities Act)
shall be entitled to contribution from any person who was not guilty of such
fraudulent misrepresentation. Each Shareholder's obligation to contribute
pursuant to this Section 5.08 is several in the proportion that the proceeds
of the offering received by such Shareholder bears to the total proceeds of
the offering received by all such Shareholders and not joint.
Section 5.09. Participation in Public Offering. No Person may participate in
any Underwritten Public Offering hereunder unless such Person (a) agrees to
sell such Person's securities on the basis provided in any underwriting
arrangements to be entered into in connection with such Underwritten Public
Offering and (b) completes and executes all questionnaires, powers of
attorney, indemnities, underwriting agreements and other
16
documents reasonably required under the terms of such underwriting
arrangements and the provisions of this Agreement in respect of registration
rights.
Section 5.10. Rule 144. The Company covenants that it will file the reports
required to be filed by it under the Securities Act and the Exchange Act and
the rules and regulations adopted by the SEC thereunder (or, if the Company is
not required to file such reports, it will, upon the request of any holder of
Registrable Securities, make publicly available such information), and it will
take such further action as any holder of Registrable Securities may
reasonably request, all to the extent required from time to time to enable
such holder to sell shares of Registrable Securities without registration
under the Securities Act within the limitation of the exemptions provided by
(i) Rule 144 under the Securities Act, as such Rule may be amended from time
to time, or (ii) any similar rule or regulation hereafter adopted by the SEC.
Upon the request of any holder of Registrable Securities, the Company will
deliver to such holder a written statement as to whether it has complied with
such requirements. Notwithstanding anything contained in this Section 5.10,
the Company may de-register under Section 12 of the Exchange Act if it then is
permitted to do so pursuant to the Exchange Act and the rules and regulations
thereunder and, in such circumstances, shall not be required hereby to file
any reports which may be necessary in order for Rule 144 or any similar rule
or regulation to be available.
Section 5.11. No Transfer of Registration Rights. None of the rights of
Shareholders under this Article 5 shall be assignable by any Shareholder to
any Person acquiring securities of such Shareholder in any Public Offering or
pursuant to a distribution to the public under Rule 144 under the Securities
Act.
ARTICLE 6
RETAIN COVENANTS AND AGREEMENTS
Section 6.01. Limitations on Subsequent Registration. Without the prior
written consent of Shareholders holding at least 51% of the Shares held by all
Shareholders, the Company shall not enter into any agreement with any holder
or prospective holder of any securities of the Company (a) that would allow
such holder or prospective holder to include such securities in any
registration filed pursuant to Section 5.01 or 5.02 hereof, unless under the
terms of such agreement, such holder or prospective holder may include such
securities in any such registration only to the extent that the inclusion of
such securities would not reduce the amount of the Registrable Securities of
the Shareholders included therein or (b) on terms otherwise more favorable
than this Agreement.
Section 6.02. Limitation on Purchase of Common Stock. Until the earlier to
occur of (i) the fifth anniversary of the Closing Date or (ii) the occurrence
of a Change in Control no Xxxxxxxxxxx Shareholder shall acquire any shares of
Common Stock or securities convertible into or exercisable or exchangeable for
Common Stock except (x) as a Permitted Transferee in a transfer from any other
Xxxxxxxxxxx Shareholder which is otherwise permitted under the terms of
Article 3 hereof or (y) pursuant to stock options granted by the Company.
ARTICLE 7
MISCELLANEOUS
Section 7.01. Entire Agreement. This Agreement, including all exhibits
hereto, constitutes the entire agreement and supersedes all prior agreements
and undertakings, both written and oral, among the parties, or any of them,
with respect to the subject matter hereof and except as otherwise expressly
provided herein.
Section 7.02. Binding Effect; Benefit. This Agreement shall inure to the
benefit of and be binding upon the parties hereto and their respective heirs,
successors, legal representatives and permitted assigns. Except as expressly
provided in Sections 5.05 and 5.06, nothing in this Agreement, expressed or
implied, is intended to confer on any Person other than the parties hereto,
and their respective heirs, successors, legal representatives and permitted
assigns, any rights, remedies, obligations or liabilities under or by reason
of this Agreement.
17
Section 7.03. Assignability. (a) Neither this Agreement nor any right,
remedy, obligation or liability arising hereunder or by reason hereof shall be
assignable by the Company or any Shareholder; provided that (i) any Permitted
Transferee acquiring shares of Common Stock in a transfer permitted under this
Agreement shall execute and deliver to the Company a Joinder Agreement, and
(ii) with the prior written consent of Shareholders holding at least 50% of
the Shares held by all Shareholders, the rights and obligations of the
Shareholders under Article 5 shall be assignable by the Shareholders to any
Third Party acquiring Registrable Securities in a transfer permitted under
this Agreement.
Section 7.04. Amendment; Waiver; Termination. (a) No provision of this
Agreement may be waived except by an instrument in writing executed by the
party against whom the waiver is to be effective. No provision of this
Agreement may be amended or otherwise modified except by an instrument in
writing executed by the Company and holders of at least 50% of the Shares held
by the Shareholders at the time of such proposed amendment or modification.
(b) In addition, any amendment or modification of any provision of this
Agreement that would adversely affect any (i) CSH Shareholder may be effected
only with the consent of CSH Shareholders holding at least 50% of the Shares
held by the CSH Shareholders, (ii) Xxxxxxxxxxx Shareholder may be effected
only with the consent of Xxxxxxxxxxx Shareholders holding at least 50% of the
Shares held by the Xxxxxxxxxxx Shareholders, (iii) Xxxxx Shareholder may be
effected only with the consent of Xxxxx Shareholders holding at least 50% of
the Shares held by the Xxxxx Shareholders, (iv) Xxxxxxxx Shareholder may be
effected only with the consent of Xxxxxxxx Shareholders holding at least 50%
of the Shares held by the Xxxxxxxx Shareholders or (v) LSH Shareholder may be
effected only with the consent of LSH Shareholders holding at least 50% of the
Shares held by the LSH Shareholders.
(c) This Agreement shall terminate on the tenth anniversary of the date
hereof unless earlier terminated.
Section 7.05. Notices. All notices, requests, claims, demands and other
communications hereunder shall be in writing and shall be given (and shall be
deemed to have been duly received if so given) by hand delivery, telegram,
telex or telecopy, or by mail (registered or certified mail, postage prepaid,
return receipt requested) or by any courier service providing proof of
delivery. All communications hereunder shall be delivered to the respective
parties at the following addresses:
(i) if to the Company, to:
IPC Information Systems, Inc.
Wall Street Plaza
00 Xxxx Xxxxxx
Xxx Xxxx, XX 00000
Attention: General Counsel
Fax: (000) 000-0000
with copies to:
Citicorp Venture Capital, Ltd.
000 Xxxx Xxxxxx--00xx Xxxxx
Xxx Xxxx, XX 00000
Attention: Xxxxxxx X. Xxxxxx, Xx.
Fax: (000) 000-0000
and
Xxxxxx, Xxxxx & Xxxxxxx LLP
000 Xxxx Xxxxxx
Xxx Xxxx, XX 00000
Attention: Xxxxxx X. Xxxxxx, Esq.
Fax: (000) 000-0000
18
and
Xxxxxxx, Xxxxxxxx & Xxxx
Two World Trade Center
New York, NY 10048
Attention: Xxxxxx X. Xxxxxx, Esq.
Fax: (000) 000-0000
(ii) if to any CSH Shareholder, to:
Cable Systems Holding, LLC
000 Xxxxx 00xx Xxxxxx
Xxxxxxx, Xxxxxxx 00000-0000
Attention: Xxxxx Xxxx
Fax: (000) 000-0000
with copies to:
Citicorp Venture Capital, Ltd.
000 Xxxx Xxxxxx--00xx Xxxxx
Xxx Xxxx, XX 00000
Attention: Xxxxxxx X. Xxxxxx, Xx.
Fax: (000) 000-0000
and
Xxxxxx, Xxxxx & Xxxxxxx LLP
000 Xxxx Xxxxxx
Xxx Xxxx, XX 00000
Attention: Xxxxxx X. Xxxxxx, Esq.
Fax: (000) 000-0000
and
Dechert Price & Xxxxxx
4000 Bell Atlantic Tower
0000 Xxxx Xxxxxx
Xxxxxxxxxxxx, XX 00000
Attn: Xxxxxx Xxxxxx, Esq.
Fax: (000) 000-0000
(iii) If to any Xxxxxxxxxxx Shareholder, to:
Xxxxxxx X. Xxxxxxxxxxx
00 Xxxxxxx Xxxx
Xxxxxxxxxx, XX 00000
with a copy to:
White & Case
0000 Xxxxxx xx xxx Xxxxxxxx
Xxx Xxxx, Xxx Xxxx
Attention: Xxxxxx X. Xxxxx, Esq.
Fax: (000) 000-0000
(iv) If to any Xxxxx Shareholder, to:
IPC Information Systems, Inc.
Wall Street Plaza
19
00 Xxxx Xxxxxx
Xxx Xxxx, XX 00000
Attention: Xxxxx Xxxxx
Fax: (000) 000-0000
(v) If to any Xxxxxxxx Shareholder, to:
IPC Information Systems, Inc.
Wall Street Plaza
00 Xxxx Xxxxxx
Xxx Xxxx, XX 00000
Attention: Xxxxxxx Xxxxxxxx
Fax: (000) 000-0000
with a copy to:
Xxxxxx Xxxxxx & Xxxxxxx
00 Xxxx Xxxxxx
Xxx Xxxx, XX 00000
Attention: Xxxxxxxx Xxxxxxxxx, Esq.
Fax: (000) 000-0000
(vi) If to any LSH Shareholder, to:
Xxxxxxxx, Xxxxx & Xxxxx XXX, L.P.
000 Xxxxxxx Xxxxxx
Xxx Xxxx, XX 00000-0000
Attention: Xxxxxxx X. Xxxxx
Fax: (000) 000-0000
or to such other address as the person to whom notice is given may have
previously furnished to the others in writing in the manner set forth above.
Section 7.06. Headings. The headings contained in this Agreement are for the
convenience of reference purposes only and shall not affect in any way the
meaning or interpretation of this Agreement.
Section 7.07. Counterparts. This Agreement may be executed in one or more
counterparts, and by the different parties hereto in separate counterparts,
each of which when executed shall be deemed to be an original but all of which
taken together shall constitute one and the same agreement.
Section 7.08. Governing Law. This Agreement shall be governed and construed
in accordance with the laws of the State of New York, without giving effect to
any choice of law or conflict of law provision or rule that would cause the
application of the laws of any jurisdiction other than the State of New York,
except to the extent that the General Corporation Law of the State of Delaware
applies as a result of the Company being incorporated in the State of
Delaware, in which case such General Corporation Law shall apply.
Section 7.09. Specific Enforcement. The parties hereto agree that
irreparable damage would occur in the event that any of the provisions of this
Agreement were not performed in accordance with their specific terms. It is
accordingly agreed that the parties hereto shall be entitled to specific
performance of the terms hereof, this being in addition to any other remedy to
which they are entitled at law or in equity.
Section 7.10. Certain Actions. Unless otherwise expressly provided herein,
whenever any action is required under this Agreement by:
(a) the CSH Shareholders (as a group, as opposed to the exercise by a CSH
Shareholder of its individual rights hereunder), it shall be by the
affirmative vote of the holders of at least 51% of the Shares then held by
the CSH Shareholders as a group; or
20
(b) the Xxxxxxxxxxx Shareholders (as a group, as opposed to the exercise
by a Xxxxxxxxxxx Shareholder of its individual rights hereunder), it shall
be by the affirmative vote of the holders of at least 51% of the Shares
then held by the Xxxxxxxxxxx Shareholders as a group.
(c) the Xxxxx Shareholders (as a group, as opposed to the exercise by a
Xxxxx Shareholder of its individual rights hereunder), it shall be by the
affirmative vote of the holders of at least 51% of the Shares then held by
the Xxxxx Shareholders as a group.
(d) the Xxxxxxxx Shareholders (as a group, as opposed to the exercise by
a Xxxxxxxx Shareholder of its individual rights hereunder), it shall be by
the affirmative vote of the holders of at least 51% of the Shares then held
by the Xxxxxxxx Shareholders as a group.
(e) the LSH Shareholders (as a group, as opposed to the exercise by a LSH
Shareholder of its individual rights hereunder), it shall be by the
affirmative vote of the holders of at least 51% of the Shares then held by
the LSH Shareholders as a group.
Section 7.11. Consent to Jurisdiction; Expenses. (a) Any suit, action or
proceeding seeking to enforce any provision of, or based on any matter arising
out of or in connection with, this Agreement or the transactions contemplated
hereby shall be brought in any Federal Court sitting in New York, New York, or
any New York State court sitting in New York, New York, and each of the
parties hereby consents to the exclusive jurisdiction of such courts (and of
the appropriate appellate courts therefrom) in any such suit, action or
proceeding and irrevocably waives, to the fullest extent permitted by law, any
objection which it may now or hereafter have to the laying of the venue of any
such suit, action or proceeding in any such court or that any such suit,
action or proceeding which is brought in any such court has been brought in an
inconvenient forum. Process in any such suit, action or proceeding may be
served on any party anywhere in the world, whether within or without the
jurisdiction of any such court. Without limiting the foregoing, each party
agrees that service of process on such party by any method provided in Section
7.05 shall be deemed effective service of process on such party and consents
to the personal jurisdiction of any Federal Court sitting in New York, New
York, or any New York State court sitting in New York, New York.
(b) In any dispute arising under this Agreement among any of the parties
hereto, the costs and expenses (including, without limitation, the reasonable
fees and expenses of counsel) incurred by the prevailing party shall be paid
by the party that does not prevail.
Section 7.12. Severability. If any term or other provision of this Agreement
is invalid, illegal or incapable of being enforced by any rule of law or
public policy, all other conditions and provisions of this Agreement shall
nevertheless remain in full force and effect so long as the economic or legal
substance of the transactions contemplated by the Merger Agreement is not
affected in any manner adverse to any party. Upon such determination that any
term or other provision is invalid, illegal or incapable of being enforced,
the parties hereto shall negotiate in good faith to modify this Agreement so
as to effect the original intent of the parties as closely as possible in an
acceptable manner.
Section 7.13. Schedule I. The parties hereto shall cooperate in causing
Schedule I hereto to set forth the securities of the Company held by them.
Section 7.14. Effectiveness. It is a condition precedent to the
effectiveness of this Agreement that the "Merger" under and as defined in the
Merger Agreement shall have been consummated.
[Signature Page to Follow]
21
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be duly
executed by their respective authorized officers as of the day and year first
above written.
IPC Information Systems Inc.
/s/ S.T. Xxxxxx
By: _________________________________
Name: X. Xxxxx Xxxxxx
Title:President & C.E.O.
Cable Systems Holding, LLC
/s/ Xxxxx X. Xxxx
By: _________________________________
Name: Xxxxx X. Xxxx
Title:Manager
Cable Systems International, Inc.
/s/ Xxxxx X. Xxxx
By: _________________________________
Name: Xxxxx X. Xxxx
Title:President & C.E.O.
/s/ Xxxxxxx Xxxxxxxxxxx
-------------------------------------
Xxxxxxx Xxxxxxxxxxx
/s/ Xxxxx Xxxxx
-------------------------------------
Xxxxx Xxxxx
/s/ Xxxxxxx Xxxxxxxx
-------------------------------------
Xxxxxxx Xxxxxxxx
Xxxxxxxx, Xxxxx & Xxxxx XXX, L.P.
Its General Partner:
LSH Partners III, L.P.
/s/ Xxxxxxx X. Xxxxx
By: _________________________________
Name: Xxxxxxx X. Xxxxx
Title:General Partner
22
SCHEDULE I
SECURITIES OWNERSHIP
EXHIBIT A
FORM OF JOINDER AGREEMENT
IPC Information Systems, Inc.
00 Xxxx Xxxxxx
New York, New York 10005
Attention: Chief Executive Officer
Gentlemen:
In consideration of the transfer to the undersigned of Shares of
Common Stock, par value $.01 per share, [Describe any other security being
transferred] of IPC Information Systems, Inc., a Delaware corporation (the
"Company"), the undersigned represents that it is a Permitted Transferee of
[Insert name of transferor] and agrees that, as of the date written below,
[he] [she] [it] shall become a party to, and a Permitted Transferee as defined
in, that certain Investors Agreement dated as of December 18, 1998, as such
agreement may have been or may be amended from time to time (the "Agreement"),
among the Company and the persons named therein, and as a Permitted transferee
shall be fully bound by, and subject to, all of the covenants, terms and
conditions of the Agreement that were applicable to the undersigned's
transferor as though an original party thereto and shall be deemed a
[Xxxxxxxxxxx Shareholder] [CSH Shareholder] [Xxxxx Shareholder] [Xxxxxxxx
Shareholder] [LSH Shareholder] for purposes thereof.
Executed as of the day of ,
TRANSFEREE:
Address:
A-1
